As a matter of good governance, Naveen Jindal should step down immediately: HP Ranina, Corporate Lawyer

Naveen Jindal receives the Gold Award for Early Completion of O P Jindal Super Thermal Power Project from Power Minister Piyush Goel during the distribution of National Awards 2013-2014 for meritorious performance in Power sector in New Delhi on June 3, 2015.In an interview with ET Now, HP Ranina, Corporate Lawyer, shares his views on a special court slapping criminal charges against Naveen Jindal in the coal scam case. Edited excerpts:

ET Now: This is certainly quite a bit of headway that has been made in the coal scam case; Naveen Jindal as well as JSPL, the company and which is the promoter have been charged in the coal block case for criminal conspiracy and cheating. Give us your views on the same?

HP Ranina: Well, it is obviously based on the factual position.

ET Now: What exactly does this mean for JSPL when you say that they have been charged under certain sections of criminal conspiracy and cheating? what do you think is the sentence that JSPL or rather the charges that JSPL will have to pay, and what possible sentence would Mr Naveen Jindal have to pay on account of these charges by the CBI Court?

HP Ranina: The amount of penalty of prosecution, that will depend. The wide range of prosecution for example, it may be three years to seven years. That depends on the law, and that depends on the discretion of the court. We leave it to that.

We cannot speculate exactly what the amount will be, but the important point is that it has been proved that they have been guilty. If they have been guilty then certainly the law will take its own course and now we will have to see what the punishment has been given.

ET Now: Criminal conspiracy is not a small charge, it is a charge which is coming on an ex-MP, it is coming on a CEO or chairman of a company who represents one of the biggest steel companies in India.So the implications of this some would argue for corporate India could be far reaching?

HP Ranina: Of course, it would be. But that is a lesson to be learn by corporate India, however, big it might be I mean you cannot do things which are in breach of the law. Nobody is above the law this is a important point and therefore it is a very good signal given to corporate India start behaving, start complying with the law as far as possible.

Nobody is immune because powers change and tomorrow even if you are the same person is in power you can still be hauled up as we are seeing in so many other cases. So this is a good signal which has been given to corporate India.

ET Now: Typically in the past what has happened to such cases when there is a criminal conspiracy? Can the promoter go to jail? What happens to JSPL because the conspiracy charges currently are against Mr Jindal?0

HP Ranina: As far as the company is concerned, they may be slapped with the penalty, if at all. It is found that these are very serious issues but the important point is that the promoters or rather the directors in charge of the company they are the people who can be in prison.

Under every law economic law a company cannot be imprisoned. Therefore it is provided that the directors in charge of the affairs of the company can be imprisoned and that imprisonment normally ranges from three years to seven years, sometime the range is as high as six months to five years. It depends on the law and that is a matter of discretion so how much imprisoned and what is the period of imprisonment that will depend on the judge who takes the decision depending on the gravity of the offence which he has committed.

ET Now: The SEBI guidelines who will be the Director of a company, who will be the CEO of the company is very clear, the court has found Mr Jindal guilty, do you think Mr Jindal now will be forced to step down from the board of JSPL?

HP Ranina: Of course, he will have to, he will need to. Apart from SEBI regulations as a matter of good corporate practice, good governance, he should step down immediately and that is a most honourable thing for him to do in order to protect the companies.

He should immediately step down irrespective of any law of the land.

ET Now: What would be the legal options at hand now for Mr Naveen Jindal given that he is being tried for a criminal conspiracy as well as cheating?

HP Ranina: Legal options are obviously to go and appeal to a higher court, which I am sure his lawyers may advice him to do. That would be the legal option. He will ask for reviews. If there are factual inaccuracies, he can again bring it to the notice of the court and ask the court to review its order.

All those regal remedies are available, and obviously they will try to drag on this case as much as possible.